Agenda item

Purpose of the report.

1.    To seek approval to borrow for projects that will reduce carbon emissions by financing renewable energy and energy efficiency projects. The projects funded will have a financial return on investment within Prudential borrowing rules.

2.    To provide a narrative statement regarding the nature of the projects that will be in scope of this borrowing facility and providing a selection of known examples of the more advanced projects.

3.    To show the quantum of carbon reductions possible within the scope of known investable renewable and energy efficiency projects; and how these projects align with the Council's Net Zero Carbon ambitions and strategy.

RECOMMENDED that the Cabinet Member for Climate Change & the Environment approves the following recommendations for onward approval at Full Council:

1.    Approves the aims of this borrowing facility in the context of the climate emergency and the council's net zero carbon ambition.

2.    That subject to a satisfactory financial appraisal that delegated authority is given to the Director of Housing, Neighbourhoods and Building Services and the Section 151 Officer, in consultation with the City Solicitor and Portfolio Holder for Climate Change and Environment to use unsupported borrowing to:

·       Approve the financing of projects associated with renewable energy

·       Approve the financing of projects associated with energy efficiency

·       Approve the financing of projects associated with other climate change mitigation where there is a clear financial rationale for their implementation

3.    Approves a borrowing facility of up to £30 million to be invested in such projects, subject to financial feasibility and the Council's limit of indebtedness.

4.    Notes that these energy and climate projects may be implemented upon the Council's portfolio of buildings and land; or may be implemented upon the buildings and assets of other organisations in the city. 

5.    Notes the Energy Services team will continue to identify and seek external funding opportunities to contribute to these initiatives to reduce the reliance on unsupported borrowing. 

The Cabinet Member for Climate Change & the Environment approved the following recommendations for onward approval at Full Council:

1. Approves the aims of this borrowing facility in the context of the climate emergency and the council's net zero carbon ambition.

2. That subject to a satisfactory financial appraisal that delegated authority is given to the Director of Housing, Neighbourhoods and Building Services and the Section 151 Officer, in consultation with the City Solicitor and Portfolio Holder for Climate Change and Environment to use unsupported borrowing to: · Approve the financing of projects associated with renewable energy

· Approve the financing of projects associated with energy efficiency

· Approve the financing of projects associated with other climate change mitigation where there is a clear financial rationale for their implementation

3. Approves a borrowing facility of up to £30 million to be invested in such projects, subject to financial feasibility and the Council's limit of indebtedness.

4. Notes that these energy and climate projects may be implemented upon the Council's portfolio of buildings and land; or may be implemented upon the buildings and assets of other organisations in the city.

5. Notes the Energy Services team will continue to identify and seek external funding opportunities to contribute to these initiatives to reduce the reliance on unsupported borrowing.

Andrew Waggott, Head of Energy Services introduced the report and Wayne Layton, Finance Manager added that although this is a Climate Change & Environment portfolio initiative, as it requires £30 million unsupported borrowing and is a change to the Capital Programme, it must go to Full Council for consideration.

In response to questions, they clarified the following points:

His team is working very closely with Kristina Downey, Principal Climate Change Officer at the council to identify projects.  The work she has been doing especially with anchor institutions has been very important for us to get our foot in the door to work with them to better articulate the reduction in carbon that can be brought about by these projects.

With previous work with utilities budget or the PV investment fund sometimes carbon reduction has been something of an afterthought.

The carbon savings from projects across departments will be centrally logged.

Traditionally the capital programme is agreed in February each year.  As this report requests unsupported borrowing, a report can be brought to Full Council at any time.  This will be a facility that will enable projects to be assessed and financed more flexibly.

Although this encompasses council buildings first and foremost, it will also allow the council to act more agile way with commercial entities in the city.

Some initiatives that are being looked at now would not have been fully formed when the budget was being set.  If this proposal had been agreed at council for £30 million, if the costs had increased a request for more money would have had to go to Full Council.

There are other measures that could be taken to save more carbon per pound spent than solar canopies and batteries.  Batteries are not in themselves carbon reducing technology, although they support implementation of technologies that are.  It is expected that upwards of 2,400 tonnes of carbon would be saved over three years.

Councillor Kimberly Barrett commented that this would enable the council to move on quickly with projects especially in light of the Climate Emergency.  Some projects may be able to include bigger solar panels than planned and therefore provide a bigger reduction in carbon, energy and save more money.

DECISIONS

The Cabinet Member for Climate Change & the Environment approved the following recommendations for onward approval at Full Council:

1. Approves the aims of this borrowing facility in the context of the climate emergency and the council's net zero carbon ambition.

2. That subject to a satisfactory financial appraisal that delegated authority is given to the Director of Housing, Neighbourhoods and Building Services and the Section 151 Officer, in consultation with the City Solicitor and Portfolio Holder for Climate Change and Environment to use unsupported borrowing to: · Approve the financing of projects associated with renewable energy

· Approve the financing of projects associated with energy efficiency

· Approve the financing of projects associated with other climate change mitigation where there is a clear financial rationale for their implementation

3. Approves a borrowing facility of up to £30 million to be invested in such projects, subject to financial feasibility and the Council's limit of indebtedness.

4. Notes that these energy and climate projects may be implemented upon the Council's portfolio of buildings and land; or may be implemented upon the buildings and assets of other organisations in the city.

5. Notes the Energy Services team will continue to identify and seek external funding opportunities to contribute to these initiatives to reduce the reliance on unsupported borrowing.